Y Combinator’s NewsLabs Bites The Dust

The “platform for new journalism,” as the company called itself, debuted in March as part of Y Combinator’s winter crop of startups and was shut down in June.

Co-founder Paul Biggar, who now works on the Javascript team at Mozilla, says he’s not ready to talk about the situation yet, but will write his own blog post on NewsLabs soon.

Perhaps because it was about journalism, and thus attracted attention from journalists, NewsLabs launched with quite a splash.

The startup proposed to help journalists build their brands online by providing the type of infrastructure that a newsroom would provide — promoting journalists’ stories on social media sites, moderating comments, controlling spam, providing feedback with Web analytics — and giving journalists 80% of any revenue that resulted.

NewsLabs also ran an ad for journalists, and Biggar claimed in March to have signed up 80. The company’s Web site (now down) listed three: Jon Margolis, book author and former chief national political correspondent for the Chicago Tribune; Les Kretman, who coordinated NBC’s coverage at the White House; and Doug Clawson, who headed the sports department at the Lewiston Sun-Journal.

“We’re talking to journalists who don’t know how Twitter and Facebook works,” Biggar said at NewsLabs’ launch. “The most common question I get is, what is Search Engine Optimization? We’re not from a media background — we’re geeks.”

But the company fell apart pretty quickly. In June, the journalist newsletter Romanesko published an apology from NewsLabs’ other co-founder, Nathan Chong, who said he’d been running the company by himself since Biggar went on his honeymoon in May and then decided to leave NewsLabs after he returned.

NewsLabs had been having problems generating Web traffic for its journalists, Chong wrote, and he’d decided to return money to investors and shut the company down rather than try to continue on his own:

…It seemed like we had the right parts (your writing and our technology) but maybe we needed to be more directed (by getting the editors involved) to move out of the hole we were in.

In retrospect, I now believe that we should never have made promises about building your online brand or large amounts of traffic (early email threads about how to deal with large number of comments now seem very ironic). If I could rewind and start again then I believe the pitch for NewsLabs should have been simpler and much more realistic: we will build you a technology platform and strive to work hard for you as programmers… but we cannot magically generate you an online brand or guarantee traffic.

We liked to use TechCrunch as a good example of an online brand… but I don’t think it was ever made clear how difficult it was to build Arrington’s work into the brand you see today. It certainly wasn’t an instant success and it was incorrect of NewsLabs to give the impression that we could easily replicate this for you.

Y Combinator, whose business model is to risk small amounts of money on young, unproven entrepreneurs whose ideas are not always well formed, did not return requests for comment. (If they do, I’ll update this post). The seed fund had solicited pitches for startups to fix the news business.

I think NewsLabs was a good idea, and one that’s sorely needed — but it’s very hard to carry out. I’ve written for Web sites run by major publishers who still had problems doing what NewsLabs promised to do — moderate comments, control spam and provide Web analytics for authors.

UPDATE: Here’s a comment from Y Combinator’s Paul Graham:

What happened to Newslabs didn’t have that much to do with working on a news-related project.The founders just decided they wanted to work on other things. It’s not unusual for that to happen to startups, but it usually happens more quietly, because most startups it happens to are not working on something so public.

3 Comments

Don August 12, 2010

It seems like Y Combinator gets an inordinate amount of coverage in PE Hub, and I’m scratching my head as to why. Yes, they provide a much needed seed stage incubator for budding entrepreneurs, but there are plenty of other off the radar funds/firms that do the same. It smacks of favoritism. Just saying.

Paul Graham August 12, 2010

Stop crying, Don.

Dan Primack August 12, 2010

Don,

1. Not exactly the most positive YC story. The company failed.

2. I can’t speak for other writers on site, but as editor: I’ve never met Paul Graham. Don’t even think we’ve exchanged emails. Certainly don’t have any money in YC. So any “favoritism” is certainly unintentional and, most likely, the result of YC producing some particularly interesting stuff.